D&G Spring 2012 collection at Milan last week was as glamorous as ever. Models strolled down the catwalk in sexy printed dresses, gold jewelry, sleek handbags and one of a kind ankle tie pumps. The designers, Domenico Dolce and Stefano Gabbana once again dazzled the crowd with an over the edge collection targeting the youthful trendy consumer. But to everybody dismay, once the show was over, the designers confirmed the rumors that D&G will no longer exist as a secondary brand to its Dolce and Gabbana line, putting an end to months of speculation in the matter.
It is not uncommon for luxury designers to add a less expensive brand to attract a wider range of consumers. The right segmentation and positioning is key to achieve marketing success and profitability in both brands. In the case of D&G, the brand was highly profitability to the franchise - which is still a private company - to the tune of 45% share in a $2.2B business. However, the lack of differentiation both in the label and price has caused many consumers of the most expensive Dolce & Gabbana brand to switch to its less expensive, lower margin business. To avoid further deterioration of its core business, the designers opted to end the D&G line and stick to its luxury brand. "Now we focus on what is Dolce & Gabbana," explained Stefano Gabbana who stresses that he wants to focus on his legacy and be remembered by its top line brand.
So, as D&G says goodbye to the fashion world, let's take a moment to cherish the best looks of its last runaway collection.
